9911796707
TMI Blog1985 (9) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... is regularly assessed to tax. The assessment was completed under s. 143 r/w s. 144B of the Act. The claim of the assessee in respect of deficit in the guest house expenses of Rs. 17,782 was disallowed by the ITO on the ground that the expenditure was hit by provisions of s. 37 as the expenditure was more or less entertainment's expenditure. Besides, the same was not also allowable as guest house expenditure. 2.1. On appeal, the disallowance was deleted on the basis of decision of Tribunal regarding guest house expenditure. 3. The ld. departmental representative read the details from records with him and submitted that in view of Expln. 5 to s. 37 the expenditure was required to be disallowed. The order of the Tribunal was not materia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccount' and consequently no deduction is claimed from the income because these payments are also not debited to Profit and loss account. It is the case of the assessee that in case eventually whenever any refunds of excise duty payment is received, may be for various reasons such refunds are refunded to representative stockists from whom recoveries were made. Accordingly, in the books of accounts for various assessment years there exists on account called 'Central Excise refund account' wherein refunds are credited and payment made therefrom are debited. In such circumstances, there is no question of the amount being taxed in the hands of the assessee. 5.2. However, the ITO taxed the refund by way of Central Excise duty on the ground tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r which no addition was made it was commented that step shall be taken. On a query from the Bench as to what contained in the letter dt. 26th Dec., 1982 nothing could be explained by the ld. departmental representative. 7. After the ld. representative for the Department had made his submissions, we had again asked him to place before us a copy of the letter dt. 26th Dec., 1982 of the assessee addressed to the ITO. He, however, was frank enough to state that in the absence of records/copy he was not in a position to place a copy of the said letter. Then we enquired of the ld. counsel for the assessee whether he would be in a position to place before us a copy of the said letter. The ld. counsel for the assessee stated that a copy of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ough the relevant letter it was submitted that the letter written to the ITO was also accompanied by relevant copies of the central excise refund account in which payments made to the various stockists together with the places were mentioned and it was also stated that now no amount was pending with the assessee on account of such refund remaining payable to the stockists. Supporting the observations of the CIT (A) that ITO did not mention anything regarding the detailed statement etc. it was stated that right from beginning the approach was misdirected. Strong objection was also taken to the observations made by the ld. departmental representatives regarding the submission that assessee was tempering with the profit Loss account when in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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